Archive | Measure H Chico Sales Tax RSS feed for this section

Unfunded pension liability up by $60 million – van Overbeek wants to “outsource” Hey, Tom, grow a pair – let’s ask the employees to pay a rational share of their own benefits!

17 Oct

I have been asleep at the wheel. It’s that time of year – leaf management, gutter cleaning, whack and blow, etc etc. And then I got the next council agenda, and I kind of woke up out of a stupor. It was the Finance Committee report from their meeting earlier this month.

https://chico-ca.granicus.com/MetaViewer.php?view_id=2&event_id=1180&meta_id=99060

Following a presentation from finance manager Barbara Martin, “Councilmember van Overbeek stated he is concerned that the unfunded liability number keeps growing and inquired if all employees are part of CalPERS.” The finance director answered yes. “Councilmember van Overbeek stated the UAL increase from $117 million to $180 million is a startling increase.“

I have to ask, was Van Overbeek elected yesterday? He’s on the finance committee, he never heard about the pension deficit?

Then Van Overbeek suggested outsourcing – yeah, yeah – we’ve heard that conversation about a thousand times, with no results. Sorensen said that outsourcing would cost more money in the long run. Van Overbeek still wanted to pursue it, asking staff to come up with a “breakdown” of all the departments and where there are “opportunities for outsourcing..” Here’s this guy talking about employee costs who doesn’t seem to understand how expensive staff time is, he just expects to snap his fingers and get this stuff. At this point Sorensen did his job – he told van Overbeek that this information was available in the appendix to the city budget that Van Overbeek is supposed to be familiar with.

Tom, you’re a fucking idiot! Time vampire! You have been on council long enough to participate in a number of contract agreements with various employee groups. You have signed onto contracts offering guaranteed raises and abysmally low shares of benefits costs without wondering where the money would come from to pay for these raises, or what effect the raises and underpayments would do to our CalPERS obligation? Why didn’t you ask these questions during the Measure H campaign?

And here’s the question for council and city manager Mark Sorensen – why, when we’ve had this same conversation all the way back to when Brian Nakamura was city manager and Mark Sorensen was on council, we’ve been fully aware of the pension deficit, and none of you have once suggested that employees pay a more rational share of their overly generous benefits.

Instead you’ve tried to foist an illegal Pension Obligation Bond without putting it to a vote of the taxpayers. The Howard Jarvis Taxpayers Association had to put a cease and desist order on that. What’s your plan now?

Tags:

With revenues remaining ‘flat,’ Chico just sent over $14 million to CalPERS in “catch-up” payments – that’s where the Measure H revenues are going, just follow the bouncing dollar sign.

29 Aug

My husband and I recently took a “working” vacation – workation? We needed a new toilet for our rental, and finding the prices at Chico home improvement stores to be prohibitive, we went to Oregon to find a better deal. With school in and Summer slowly giving over to Fall, our usual motel had a cheap room for us. We got more savings at local grocery stores and produce stands. We stocked up on household stuff at Walmart, including all the type of over the counter medicines that are taxable in Chico. Shoes on SALE! at Big 5, we bought two pairs. We saved money that offset the price of the motel even further.

I’ll say, you need to do stuff for your mental health too. Every now and then, we need to get out of town, see how other people are doing things. As a Chico resident, I can tell you first hand – Chico has become an unpleasant place to shop, financially, morally, and aesthetically.

Medford, for example, has a vibrant retail sector. The stores are clean and well-run, and you can find what you need, no empty shelves. Their Winco is bigger and has a wider brand selection of various products. There are two really nice natural foods stores, with super fresh local produce. We couldn’t do the U-Pick farms this year, but we found really good apples and pears at the grocery store, for $2.50/lb.

Free parking everywhere, no kiosks, no hassle getting where you want to go.

Here’s the funny thing – while Chico is reporting flat revenues, even after a full one-cent sales tax increase, Medford reports their revenues have been on the up, up, up since COVID ended. With no state or local sales tax.

Chico made the same mistake that a Redding City Council member has called out – basing budget projections on one-time money, and then crying poormouth when the funds dry up. Specifically, American Rescue Funds. Those funds – millions – were horribly miss-spent by the city of Chico, and furthermore, included in budget projections for the future, even though they were one-time grants.

Having spent those funds like a pack of drunken sailors instead of dedicating them to needed infrastructure projects, they had some nerve to put the bite on voters to approve that one-cent sales tax. Of course they put up a simple majority measure that guaranteed the money would go into the General Fund, with no restrictions on spending.

“The ending of federal funds, like the American Rescue Plan, and a drying up of city grant money ($5.2 million) are creating a gap that could lead to dipping into the general fund for programs, including those for the homeless.”

“programs” – yeah sure! As usual, employee expenses continue to grow. According to city finance manager Barbara Martin, “On the expense side, personnel costs remain the leading driver. Unfunded pension liability continues to loom large, with the city’s payment for the upcoming year exceeding $14 million.”

Yep.

Meanwhile, “City of Medford revenues are not flat; recent trends and future projections indicate growth, though the rate has varied. While growth slowed slightly during the COVID-19 pandemic, city reports and budget adoptions show upward trends, with a significant increase projected for the upcoming 2025–2027 budget cycle…”

Medford voters will be asked to approve a Transient Occupancy Tax increase. My husband tells me Oregon’s overall TOT is higher than California. But who cares – it’s a percentage of the total room price, and the places we stay in Oregon are so much cheaper than their counterparts in California, TOT is more like a charitable donation to keep the town you’re visiting ahead of the extra infrastructural strains of tourism. I’ll say, the big, busy streets and intersections around our hotel and the retail areas we patronize are well planned, well maintained, and pedestrian friendly.

UPDATE: I looked it up – Medford has a 10.5% TOT, 9% of which goes to the city of Medford to help provide the amenities that tourists enjoy while remediating the strains of tourism, like extra traffic. Meanwhile, Chico charges 12% TOT, 10% goes to the GENERAL FUND. As you will recall, the General Fund is a grab bag with no restrictions. Again, the General Fund is looted every year for millions (this year over $14 million) to pay the unfunded liability left by the completely unrealistic shares that city employees pay for their overly generous benefits.

When we shop in Chico, I oftentimes have to sit in our truck while my husband goes into a store to safeguard tools we have to carry in the back of the truck. We’d never think of walking to do any shopping in Chico, even small grocery purchases, and we never ride our bikes in Chico anymore. People who have moved here within the last 20 years just wouldn’t get it – Chico was better than this when my husband and I were raising our family here. Now it’s gone past the pale, and I don’t know if there’s any coming back.

My prediction – they are going to try to float a bond for the sewer.

Finance Committee Report: Taxpayer Protection Act will invalidate Measure H in December 2025

27 Sep

Well, there I said it yesterday, and today I heard it – yes, city of Chico management is worried about the Taxpayers’ Protection Act.

At today’s Finance Committee meeting, city manager Mark Sorensen jumped on the Misinformation Bandwagon. “The act would amend the California Constitution to restrict the ability of the state, counties, other local agencies and the electorate to approve or collect taxes, fees, and other revenues.”

Restrict the ability of the electorate? You mean, the voters? How does an amendment that requires 2/3’s of the voters to agree on something before it is shoved up our collective patoot “restrict the ability of the electorate”?

One actual fact coming out of Sorensen’s report is that if the TPA passes, Measure H, the Chico sales tax, would be invalidated, void, deader than a doornail as of December 2025. He listed two reasons why Measure H did not comply with the TPA – the duration of the tax was not listed on the ballot measure, neither was the use of the revenue.

In fact, there are three reasons H would be invalid, but let’s talk about the ones he listed. I’m not sure the first one was important, since it was pretty clear that H would be perpetual. But that should be in the discussion, and in the language of the measure.

The second reason was the subject of a lawsuit in Yuba County. Like Yuba County Measure K, Measure H was a General Use measure, because it only required 50+1, meaning the revenues go into the General Fund with no restrictions on spending. The ballot measure should have said “for general government use“, me and other opponents tried to point that out again and again. The Finance Department Staffer even said that any “surplus” left over in the General Fund at the end of the year is likely to go toward the Unfunded Pension Liability. But, like Yuba County Measure K, Measure H listed specific uses, like public safety and road repairs, as bait. If that’s not illegal now, we really need to pass the Taxpayer Protection Act.

Furthermore, Sorensen mentioned NOTHING about the 2/3’s voter approval requirement. Is he in denial or what? The TPA will invalidate any measure that was passed with less than 2/3’s voter approval. Why did he leave that out of his report?

Sorensen listed several options.

Place a successor to Measure H on the Nov 24 ballot with the Acts additional requirements. That of course would mean, get to work immediately, and would entail a lot of money for a consultant to poll the public and write the ballot, etc. There was no dollar estimate there and nobody at the meeting expressed interest.

Wait to see if the act is passed by voters in 2024. Of course they would be able to collect the tax right along, and I’m not sure if they would have to pay it back.

If the act passes (pick one):

A) Declare an emergency to place Measure H back on the ballot, in compliance with the Act’s new requirements, prior to December 2025. I think that would require a special election because Sorensen makes note, with bright yellow highlighting – “High special elections costs”.

B) Do nothing and let the 1% sales tax expire in December 2025. Well, we have a winner as far as I’m concerned but Finance Committee member and Mayor Andrew Coolidge seemed more interested in the next option.

C) File a lawsuit to challenge the window period provision of the Act. Ha ha – here I’ll note – the city of Chico is up to their ass in lawsuits right now. In fact, the Finance staffer said the city attorney’s litigation fund is over budget by $770,000 (aka, three quarters of a million dollars …). So yeah, another lawsuit, that’s what we need – let’s just sue the voters! Cause that’s what it would mean to sue over a measure passed by the voters, wouldn’t it?

Coolidge wanted to know how many other cities have passed taxes that would be subject to the TPA – “how many other municipalities are in FREE FALL?” he asked. He asked Sorensen “can we get a legal opinion to amend Measure H?” I’m not sure what he means, except, he’s willing to spend more of our money to buck the will of the voters. He also asked for “an estimate of special election costs… “

Sorensen seemed annoyed – he reminded Coolidge, council members had received a confidential legal analysis of the TPA, and both of those questions were covered. You have to wonder if Coolidge even reads the staff reports.

In the end it all came down to “wait and see”. Sorensen discussed ACA 13, but obviously does not understand it. He “thinks” it will take effect immediately, requiring the TPA to get 2/3’s approval. I don’t know the answer to that either, but you know what – I don’t get $211,000/year to manage a town, and I don’t have a $200,000/year lawyer on my staff. So I’ll ask the folks at Howard Jarvis Taxpayers Association, I’ll send them a copy of Sorensen’s report and see what they think.

Coolidge expressed some childlike doubt that the TPA would pass – assuming it would need 2/3’s approval because he’s so sure ACA 13 will pass. He claims to know several union officials, and they’re making the defeat of the TPA a “Number One Priority“. Well, it’s just good to know who the mayor’s friends are. And that just goes to show you, it’s the tax advocates, not the taxpayer advocates, who are behind ACA 1 and 13.

Sean Morgan opined, “It’s like the CalPERS thing… we see a train coming… but we can’t do anything about it…”

Yeah, that’s the situation – these people have set our town on the train tracks. And it’s not just one train – we’ll cover the CalPERS Express next time, on This Old Lady Says “Get your ass off the tracks!”